China Announces Discovery of Massive Coal Deposit


"The discovery of a massive new coal reserve in Xinjiang Uygur is hoped will help meet China's coal requirements, which are set to grow to 1 gigaton during the 12th five-year plan."

China has reportedly discovered an 89.2B-tonne coal reserve at Sha'er Lake in northwest Xinjiang Uygur, in a find that is being termed the largest in Asia.

The new find is expected to be slightly bigger than Inner Mongolia, currently China's largest coal producing region—it surpassed that of the Shanxi province to become the largest coal producing region last year with an annual output of 782M tonnes.

Coal output rose 26.6% year on year to 908M tonnes in the first 11 months of the year. The output in November alone has been pegged at 94.1M tonnes, up 18.1% year-on-year from the Inner Mongolia region.

According to the provincial statistics bureau, Shanxi's coal output reached 790M tonnes between January and November 2011, registering an annual increase of 18.6%. The November output rose 15.3% to hit a monthly record of 80.8M tonnes.

With estimates that coal reserves in Xinjiang hovered over 2T tonnes, which is 40% of China's total coal reserves, the new coal find is expected to help the country meet its energy consumption needs.

During the 12th five-year plan, China's energy consumption of standard coal is set to increase by 0.8 to 1 gigaton, with an average annual increase of 4.8% to 5.5%, according to a recent report of the China Energy Development 2011. The report noted that China's energy consumption increased 900 megatons, with an annual increase of 6.6%.

According to Chinese customs data, the country's imports of coking coal hit a 10-month high of 5.1M tonnes in November, the highest since it imported 5.6M tonnes in January this year. November imports were up 19% from imports of 4.3Mmt a year ago and were up 21% from 4.2M tonnes in October, according to official data.

The country's net imports of the fuel in 2011 are expected to reach around 150M tonnes. However, the National Development and Reform Commission, China's top economic planner, has also warned that coal shortages would occur in some regions.

Shivom Seth, Mineweb

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